AUD/USD Daily Outlook

Daily Pivots: (S1) 0.8582; (P) 0.8614; (R1) 0.8665; More

AUD/USD's rally resumes after brief consolidation and reaches as high as 0.8693 so far today. Intraday bias is now on the upside and further rally should be seen towards 61.8% projection of 0.6284 to 0.8262 from 0.7702 at 0.8924 next. On the downside, below 0.8617 minor support will turn intraday outlook neutral again and bring more consolidation. But after all, break of 0.8239 is needed to indicate that AUD/USD has reversed. Otherwise, outlook will remain bullish.

In the bigger picture, AUD/USD is trading above medium term rising trend line (0.6284, 0.7702) and thus, rise from 0.6282, and that from 0.6008, is still in progress. The strength of the rise from 0.6008 and the firm break of 0.8519 resistance argue that AUD/USD is developing into another up trend. In other words, long term correction from 0.9849 has possibly completed at 0.6008 already, after being support slightly above 76.4% retracement of 0.4773 (01 low) to 0.9849 (08 high). Having said that, the current rally from 0.6008 might extend further to retest 0.9849 high next.

On the downside, below 0.8239 support will have the medium term rising trend line firmly broken and thus argue that a medium term top is formed. Some deep pull back and lengthy consolidation might then be seen, with prospect of fall to 0.7267/7702 support zone. But a break of 0.7267 resistance turned support is needed to indicate that whole rise from 0.6008 has completed. Otherwise, we'll continue to favor the longer term bullish case even in case of deep correction.

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